Nordstrom, Kohl's post lower profit, warn

SAN FRANCISCO (MarketWatch) -- Nordstrom Inc. and Kohl's Corp. on Thursday both reported lower first-quarter earnings and warned that the tough retail climate in the U.S. will likely cause even more damage to their bottom lines in the coming months.

Seattle-based Nordstrom
JWN, -1.81%
posted a profit of $119 million, or 54 cents a share, down from $157 million, or 60 cents a share, a year earlier.

Revenue dipped 3.8% to $1.88 billion. Same-store sales retreated 6.5% while the company had expected a drop of no more than 5%.

Analysts polled by FactSet Research were looking for a profit, on average, of 50 cents a share with revenue of $1.88 billion.

The high-end retail chain also warned that it expects 2008 earnings of $2.65 to $2.80 a share, down from a prior targeted range of $2.75 to $2.90 a share.

Wall Street previously forecast a full-year profit of $2.82 a share.

Nordstrom also pegged second-quarter earnings at 65 cents to 70 cents a share. Analysts are looking for a profit of 69 cents a share.

Nordstrom shares ended the regular session up 3.2% to $37.29, but are still down more than 30% in the past year.

Kohl's
KSS, -2.81%
also offered evidence of tighter purse strings among its customer base. The Menomonee Falls, Wis.-based department store chain handed in first-quarter profit of $153 million, or 49 cents a share, down from $209 million, or 64 cents a share, a year ago.

Analysts had predicted the company would earn 45 cents a share on $3.62 billion in sales.

"We remain conservative in our sales expectations for the balance of the year and will manage our business accordingly," Chairman and CEO Larry Montgomery said. "We will continue to invest for the long term as we add new stores and remodel existing stores as well as invest in people and technology for market share gain."

As for its outlook, Kohl's said it expects to earn 70 cents to 74 cents a share in the second quarter and $2.95 to $3.15 a share for the full year, below estimates of $3.20.

Kohl's shares, down 30% for the year, closed ahead of the report with a 1.8% gain at $50.49.

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